Singapore has always been one of the famous homes to big businesses all over the world. It houses almost all of the biggest corporations from every industry. It is one of the safest and most stable places to build a business because of the business policies that it implements.
When you conduct a business, you have to look for a place where there is a minimal risk but high revenue potentials. This is one of the characteristics of Singapore over the years. It exhibits one of the most resilient economies in the world. That is why there are still more investors and big corporations that want to put their money and the economy of Singapore.
When it comes to policies and regulations, that has the most lenient and relaxed laws. In 2020, it was even named as the most open market business economy in the world. Even if there are already thousands of different businesses that offer different goods and services in Singapore, it is still attractive to business owners. Even businesses from halfway across the globe are interested in expanding and to incorporate company in Singapore.
However, company incorporation Singapore procedures for international businesses may be more complicated than incorporating local ones. This is because Singapore ensures that all businesses are legal and law-abiding. These policies for international businesses are also to make sure that all existing local businesses are protected and have a safe space in their economy. One of the things that international corporations can do is to have a representative office in Singapore.
What is a representative office?
A representative office in Singapore is a legal representative or a branch extension that has no legal assets and acts as a temporary branch of a foreign company. Singapore offers these options before one should decide to incorporate company in Singapore for them to be able to gauge the risks and potentials of building a business here. It allows a representative office to analyze and assess the benefits and potential losses before doing the company incorporation Singapore procedure.
If a foreign company is not yet able to incorporate company in Singapore and only acts as a representative office, they are prohibited to engage in any activity that gives revenue and profit. however, they can spend their money in this process.
#1 Things that a registered representative office is allowed to do
As mentioned above, a representative office is only allowed to gauge the potentials of the market for the foreign company. Their activities are limited until after the company incorporation Singapore process is done. Activities that can generate profit can only take place once they incorporate company in Singapore. They can only engage in activities like research and market feasibility studies that can allow them to weigh the pros and cons of expanding in Singapore.
For example, they can attend trade shows and exhibitions that can help them gather information about potential clients and customers. One thing that all representative companies must remember is that they are considered as the same entity as the original foreign company. That is why the parent company is held liable for all the actions of the representative office company before the company incorporation Singapore process is done. Complying with these rules is important so that when they incorporate company in, there would be no problems or issues.
#2 Requirements
Even if you will not incorporate company in Singapore, there are certain requirements that a representative office needs to settle. A company incorporation Singapore procedure already has many requirements. However, before you can continue with that you have to settle the requirements first for the representative office. One of the first qualifications for you to be able to have a representative office is a sales turnover of USD 250,000. Another one is to be an established company for at least three years. These are just a few of the requirements for setting up a representative in Singapore.
#3 Process and costs
Applying for a company representative in Singapore takes a few steps and a few dollars. It is harder to incorporate company in Singapore than to apply for a representative office. For a representative office, you just have to fill up an application form and pay around USD 200. The company incorporation Singapore procedure takes longer and more costly.
Need help?
There are also service providers that can help you set up a company representative in Singapore. WLP group is one of the most trusted and most reliable service providers. Contact us today to get started.
